Another significant fault the report found was
that a number of cash advances were used to
pay staff allowances. Cash advances for staff
training were also reportedly transferred into
the bank accounts of NPHCDA accountants,
amounts as high as N91 million (US$600k)
going to individual staff members. “The audit
noted instances of discrepancies between the
cash advance transferred to the accountants’
bank accounts and the amounts withdrawn by
the accountants for planned programme
activty Gavi says.
The Global Alliance for Vaccines and
Immunization (GAVI), a public-private global
health organization that assists with vaccine
procurement, yesterday released the findings
from an audit of $29 million USD in funding
given to Nigeria between 2011-2013.
The Programme Fiduciary Oversight team of
Gavi, which is based in Geneva, found that the
Nigerian Federal Ministry of Heath and the
National Primary Health Care Development
Agency (NPHCDA) were guilty of arrant
malpractice and fraud.
Professor Onyebuchi Chukwu, immediate past
Nigerian Minister of Health
Photo Credit:
AP
The findings, released in Geneva, claim that the
funds—intended for procurement of vaccines
and health systems strengthening for children
in Nigeria—were badly misused.
“The report describes systemic weaknesses
regarding the operation of controls and
procedures in national systems used to manage
Gavi cash-based support,” Gavi stated.
Specifically, the report found that only an
approximate “40 per cent of the total
expenditure of N4.5bn (US$29m) in the period
2011-2013 was spent on procurement with the
main categories being: printing N919m (US $
5.8m); incinerators N184m (US $1.2m); drugs
N243m (US $1.6m); rehabilitation and
equipping of medical facilities N437m (US $
2.8m); other procurement N90m (US $397k),
motor vehicles N17.8 (US 113k).”
SaharaReporters extensively reviewed the final
report, noting that after the release of a
preliminary report of the audit, cash-based
support was suspended in April 2014.
“Remediation of the identified weaknesses will
need to be undertaken before disbursements
can start again,” the final report
recommended.
Disbursed funds that had not been used were
also frozen.
Following this, Gavi assigned UNICEF Nigeria to
supervise pediatric health systems
strengthening activities. “Gavi has asked
UNICEF Nigeria to oversee the implementation
of a limited number of activities that are
deemed critical to routine immunisation and
health system strengthening,” it said.
As part of its report, Gavi has officially called
for the Economic and Financial Crimes
Commission (EFCC) to investigate the finding
and assure reimbursement of a portion of the
funds.
“Gavi and its partners have a zero tolerance on
the misuse of funds. When misuse is identified
Gavi requires reimbursement,” Gavi said.
“Inappropriate use of funds not only
undermines confidence in development
support but it means that the desired
beneficiaries, who often already live in
challenging circumstances, do not see much.”
“As a result of specific findings the
Government of Nigeria has agreed to repay
funds deemed to have been misused, which are
quantified as US$ 2.2 million.”
The audit presents major questions for both
the Nigerian Ministry of Health as well as
NPHCDA. Weak leadership, disorganization, and
conspiracy to commit fraud were all factors
that the health organization feels contributed
to the mismanagement of funding. “The audit
identified fundamental weaknesses in controls
around procurement including a lack of
segregation of duties, ineffective oversight, and
indications of collusion that created an
environment that Gavi believes resulted in
irregular activities.”
Among the irregular activities mentioned in the
report were weaknesses in the management of
disbursements to states.
In the year 2012, the total amount disbursed
to the states was US $2m, despite an approved
budget of US$3.2m. At the close of 2013, the
total amount of advances disbursed was US $
1.4m, despite an approved budget of US $
6.4m.
“At the states, zones and LGA level, the audit
noted delayed liquidation of advances and in
many instances, no liquidation at all. For
several states, advances remain outstanding for
months or years. As at 31 December 2013,
N157m (US$1m) was outstanding with N125m
(US $935k) outstanding for more than 12
months. At the zone level, as at 31 December
2013, N37m (US $239k) was outstanding for
more than six months.
Failure to properly track and ensure taxes
were properly and justly paid was also a
substantial issue.
The report said, “Total tax remitted to the
Federal Internal Revenues Services (FIRS) for
the period 2011–2013 according to the bank
mandates was N62m (US$390,000) for Value
Added Tax (VAT) and N89m (US$560,000) for
Withholding Tax (WHT). The audit was unable
to verify that payments were correctly made to
the relevant tax authorities: specific accounts
are not maintained in the accounting system
for VAT and WHT to record and monitor the
taxes paid.”
Another significant fault the report found was
that a number of cash advances were used to
pay staff allowances. Cash advances for staff
training were also reportedly transferred into
the bank accounts of NPHCDA accountants,
amounts as high as N91 million (US$600k)
going to individual staff members.
“The audit noted instances of discrepancies
between the cash advance transferred to the
accountants’ bank accounts and the amounts
withdrawn by the accountants for planned
programme activity,” Gavi says.
As a result of the findings, the oversight team
made an extensive amount of
recommendations to the organization.
The most significant of these was a full audit
of all high-risk expenditures in prior years.
“Because of the identified weaknesses in
controls and indications of misuse, Gavi will
undertake a full-scale audit to cover both
select, high-risk expenditures in prior years,
and other expenditure from the period
2011-2013 not examined in the course of this
audit,” the report stated. Gavi also made clear
their intent to seek repayment for missing
monies through the EFCC.
While the Nigerian medical entities implicated
in the report did not speak to the press on the
matter, an October 17 letter titled Letter of
Understanding on the Principles regarding the
Gavi Cash Program Audit 2011-2013” and
signed by immediate past Minister of Health,
Prof. Onyebuchi Chukwu acknowledged
weaknesses in the management of Gavi funds.
The letter, which was written in response to
preliminary reports, assured Gavi that the
Nigerian government would refund
misappropriated money and would welcome
further audits of Gavi funding.
The letter also promised steps would be put in
place to deter corruption and increase
accountability. “In response to the CPA, the
Ministry of Health and NPHCDA have
introduced a number of measures to
immediately enhance the transparency and
accountability of systems. These include the
upgrading of the Internal Audit Unit to a
department empowered to undertake physical
verification; the introduction of routine checks
to validate that purchased assets have been
delivered and installed appropriately across
the country; and the computation of a fixed
asset register."
The letter furthers, “The Ministry of Health and
Gavi appreciate the role of partners,
particularly UNICEF and WHO, in channelling
Gavi funds during the transitional period while
the executing entities are strengthening their
capabilities. For the longer term, the
appointment of a fiduciary agent was agreed to
oversee the financial management of Gavi’s
grants at both federal and state levels.
The appointment of a fiduciary agent to
oversee the financial management of Gavi’s
grants to Nigeria, at both federal and state
levels, has also been agreed between Gavi and
the Government of Nigeria. The fiduciary agent
will also be tasked to help remediate the
weaknesses identified at Nigeria’s National
Primary Health Care Development Agency.
“This appointment will also support the
enhancement of executing entities’ capacities
to strengthen systems of transparency and
accountability,” the statement concluded.


source: http://saharareporters.com/2014/10/30/nigerias-ministry-health-others-mismanage-29-million-meant-vaccination-children—auditors